CommonSpirit takes 'firm stance' with payers

Chicago-based CommonSpirit is pushing for change in the dynamics of payer-provider relationships and is "taking a firm stance on contract renewals so payers absorb a share of inflation," management said in financial documents published May 15. 

The 142-hospital system said one of the most critical levers for health systems to maintain financial stability is to receive the revenue and cash flow they are entitled to for services provided. 

The news comes shortly after CommonSpirit split with Anthem Blue Cross Blue Shield of Colorado. The breakup, which affects commercial and Medicare Advantage members, means 11 of CommonSpirit's hospitals and more than 40,000 of its patients in the state are now out of network with the insurer. 

"It was never our intent to leave the Anthem Blue Cross Blue Shield network, only to work together in good faith toward a balanced agreement," CommonSpirit said in a statement on its website

The system said that it is willing to continue working toward a new agreement with Anthem but its previous proposals "failed to offer terms that fairly reimburse for services provided to its members, and equitably cover the burden to get reimbursed timely and accurately."

During a Feb. 29 investor call, CommonSpirit CFO Dan Morissette said the system is having significant challenges getting paid appropriately for care provided through some of its Medicare Advantage programs.

"Rarely, if ever, [have I] seen the kind of payer behavior that we've seen recently," Mr. Morissette said. "Denials that are absolutely not in accordance with the contracts that we have, delayed payments where we need to go to arbitration and/or litigation to try to get paid for work that we're clearly entitled to. The behavior overall has been egregious."

Certain markets are seeing a higher concentration of these payer challenges, but most markets are experiencing at least some issues, according to CommonSpirit, which operates healthcare facilities in 24 states. 

"We have some markets in which the payers themselves have a near-monopoly on the commercial insurance market and therefore we do not receive enough reimbursement to offset the costs of Medicaid, self-pay and even some of the Medicare outpatient things," Mr. Morissette said.

In addition to taking a harder line with payers, CommonSpirit said it is also strengthening its revenue cycle function, including clinical denials and documentation, underpayment review, patient collections at the service site, outsourcing additional accounts to specialized vendors, and revenue cycle performance with its partners. 

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